An Introduction to California's Greenhouse Gas Emission Trading Program

Forthcoming in Journal of Jiangsu University, Social Science Edition (Sept. 2013)

Santa Clara Univ. Legal Studies Research Paper No. 24-13

7 Pages Posted: 2 Jul 2013 Last revised: 29 Oct 2013

Date Written: July 1, 2013

Abstract

Even though climate change will require a global solution, the efforts of individual nations and sub-national governmental units have become increasingly important for demonstrating leadership in creating effective regulatory programs and possible solutions. California’s Global Warming Solutions Act of 2006, also referred to as A.B. 32, and the associated greenhouse gas emission trading program are one set of such efforts. With A.B. 32, the state of California has created one of the most comprehensive and complex climate change programs in the world – a legally binding set of mandates for the state government to reduce greenhouse gas (GHG) emissions to 1990 levels by the year 2020 that is implemented in part by a highly sophisticated GHG trading system. Although a number of years have already passed since A.B. 32’s first enactment, the highest-profile regulatory action, the emission trading program, also referred to as a cap-and-trade system, became effective only recently.

This short essay is designed to provide an introduction to the basic aspects of the California Global Warming Solutions Act as well as the GHG Emission Trading Program. In particular, the essay will touch on the scope of the emission trading program’s carbon cap and what sources are covered, the cap decline by 2020, carbon allowances and offset-credits as well as related allowance banking issues, reporting and compliance processes, and linkage with other emission trading systems.

Keywords: A.B. 32, California Global Warming Solutions Act, California GHG Emission Trading Program, California Cap-and-Trade Program, Climate Change Policy, Carbon Emission Trading

JEL Classification: K32, Q28, Q48

Suggested Citation

Yang, Tseming, An Introduction to California's Greenhouse Gas Emission Trading Program (July 1, 2013). Forthcoming in Journal of Jiangsu University, Social Science Edition (Sept. 2013) , Santa Clara Univ. Legal Studies Research Paper No. 24-13, Available at SSRN: https://ssrn.com/abstract=2281821 or http://dx.doi.org/10.2139/ssrn.2281821

Tseming Yang (Contact Author)

Santa Clara Law School ( email )

500 El Camino Real
Santa Clara, CA 95053
United States
408-551-6037 (Phone)

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